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Grains & Beans

  #81 (permalink)
 myrrdin 
Linz Austria
 
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Tomorrow, Thursday, at 11 am (Chicago Time) / 18.00 (Central European Time) USDA will publish its May report.

This report can be a game changer, as new crop gets more and more important.

I suggest to keep positions moderate going into this report.

Best regards, Myrrdin

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  #82 (permalink)
 myrrdin 
Linz Austria
 
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myrrdin View Post
My positions in the grains & beans currently are:

Short CZ P4, P4.1 (short-dated contract, expiring in June)
Supply & Demand (S&P) bearish according to recent USDA Report

KWN-WN
Dryness

5*CZ-2*SX
Acreage might move from corn and Minneapolis Wheat to beans; uncertainty regaring safrina corn

SMN-SMZ
Shortage of Meal from Argentina. This positions also serves as a hedge for the short beans position in the CZ-SX spread.

Short WZ C7. This position also serves as a partial hedge for the long corn positions.

Best regards, Myrrdin

I liquidated the 5*CZ-2*SX position. The USDA report was bullish Soybeans. In addition there is some risk that China and Mr. Trump will find an agreement within the next couple of months. In this case, exports to China will grow significantly, and Soybeans price will move upwards quickly.

Instead I bought the CZ-WZ spread, as the USDA report was bullish Corn and bearish Chicago Wheat.

I also added some short WU C5.40, as I think the highs for the Chicago Wheat price are in.

Best regards, Myrrdin

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  #83 (permalink)
 myrrdin 
Linz Austria
 
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USDA Report in about one hour. The June report often is boring, but also can be a market maker. Be careful.

Best regards, Myrrdin

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  #84 (permalink)
zxcv64
London, UK
 
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myrrdin View Post

Instead I bought the CZ-WZ spread, as the USDA report was bullish Corn and bearish Chicago Wheat.

Hi @myrrdin, how did this spread work out for you? Are you still in this? I'm looking at seasonalgo at this very spread and it is looking like a mild/moderate buy purely from a technical point of view. The trade wars with China and their resulting storm will have an affect of course, but looking at last Friday, it seems as if the grains may be levelling out, and even rising a little.

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  #85 (permalink)
 myrrdin 
Linz Austria
 
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zxcv64 View Post
Hi @myrrdin, how did this spread work out for you? Are you still in this? I'm looking at seasonalgo at this very spread and it is looking like a mild/moderate buy purely from a technical point of view. The trade wars with China and their resulting storm will have an affect of course, but looking at last Friday, it seems as if the grains may be levelling out, and even rising a little.

I liquidated this spread some weeks ago without significant profit or loss.

I was wrong in recent months assuming a significant rise of the corn price. Reasons were:

Safrina crop received unexpected rain just in time,
there is no weather premium built into corn price before the pollination in the US although a less than perfect crop would yield significant problems for supply & demand,
corn price suffered under the trade war, although there is almost no corn exported to China.

In sum, the corn trades still showed a nice profit, the profits for the CZ-SX spreads and the short CZ puts significantly offsetting the loss from the CN9-CZ9 spread. All corn trades are closed.

I do not intend to trade corn as long as the results for pollination are unclear.

The only trade I currently hold in the grains is a long position in Oats for seasonal reasons. But it does not seem to work this year, and I intend to close it soon with a small profit.

Best regards, Myrrdin

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  #86 (permalink)
 myrrdin 
Linz Austria
 
Experience: Advanced
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I currently hold the following positions in the Grains and Beans:

WNZ8 and WNV8 C6 - WN9.

This year, there are weather problems in most of the wheat growing countries with the exception of the US. Next year, some farmers might grow wheat instead of soybeans and corn. The spread looks extremely cheap.

SU-SX
Short term trade for seasonal reasons.

Best regards, Myrrdin

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  #87 (permalink)
 myrrdin 
Linz Austria
 
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USDA Report in about 20 minutes. The August report is known for being the potential cause of large price movements. Be careful.

Best regards, Myrrdin

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  #88 (permalink)
zxcv64
London, UK
 
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myrrdin View Post
USDA Report in about 20 minutes. The August report is known for being the potential cause of large price movements. Be careful.

Best regards, Myrrdin

Yep, the report has had some impact with the grains falling. This is positive for me overall - I have some wheat short call spreads open and they've just gone into profit after the report. I also have some corn and wheat calendar spreads which are showing a good profit now too. On the negative side, I have some ZS short put spreads too, which are well underwater.

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  #89 (permalink)
 myrrdin 
Linz Austria
 
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zxcv64 View Post
Yep, the report has had some impact with the grains falling. This is positive for me overall - I have some wheat short call spreads open and they've just gone into profit after the report. I also have some corn and wheat calendar spreads which are showing a good profit now too. On the negative side, I have some ZS short put spreads too, which are well underwater.

I have to study the reports in detail before having an opinion.

But I will not have an opinion on S&D for the soybean complex before the issue between Mr. Trump and China is over. Thus, I currently avoid trading this commoditiy.

Best regards, Myrrdin

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  #90 (permalink)
 myrrdin 
Linz Austria
 
Experience: Advanced
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I was asked about my opinion on soybeans in the softs thread.

Yesterdays USDA report was bearish soybeans. But my recent argument (see post below) is still valid: In case Mr. Trump and the Chinese find a solution of their problems the soybean price will move up immediately.

Thus I do not trade soybeans at the time being. There are better trades around.

Best regards, Myrrdin

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Last Updated on October 5, 2022


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